Friday, November 30, 2012

Chip maker Advanced Micro Devices, Inc. (NYSE:AMD)’s plans
to sell its campus in Texas, led to a surge in its shares by more than 8
percent.

The company seeks to raise $150 million to $200
million in a transaction that may close in the first quarter, said Drew
Prairie, a spokesman.

The plan is to sell the site and the lease it back for
several years.

The personal computer industry is currently in a
downturn as customers are increasingly turning to tablets and smartphones for
their computing needs. Chip makers such as AMD have been at the receiving end
of this and there are concerns among analysts with AMD may well cease to exist
in about two years.

The cash raised through the sale of real estate will
help the company but analysts said that if the company wants to be competitive
it needs more funds. The company is estimated to run through about $100 million
this quarter.

AMD shares rose 8 cents, or 4.1 percent, to $2.04 at
the close in New York after earlier touching $2.12. The stock has lost 62
percent of its value this year.

Last month the company guided for a fourth-quarter
sales that fell short of analysts’ estimates and said it will cut 15 percent of
its staff, citing weak demand across all product lines in a challenging
economic environment.

For AMD it is very important to raise its cash
reserves in order to be sustainable in the short term.